Eagle warns of “existential crisis” in manufacturing as Javid hauled to Commons for emergency steel debate

Angela Eagle today warned of an “existential crisis” for British manufacturing if the Government fails to support the steel industry.

Speaking at an emergency debate triggered by Tata’s plans to pull out of the Port Talbot steel mill, Eagle said the Government had broken its promise to rebalance the economy and boost manufacturing in the aftermath of the financial crisis. The success of other parts of UK manufacturing, such as automotive, defence and construction businesses, is tied to the supply from the threatened steelworks, said the shadow Business Secretary.

Labour called for the emergency debate immediately after the Parliamentary recess, during which Tata announced plans to withdraw from its UK steelworks, following repeated losses at the Welsh facility.

Eagle outlined the areas in which the Government could support the industry, including taking action against Chinese steel “dumping”, procuring British steel for its contracts, investing in the industry and reducing business rates for the plants.

Eagle said there were worrying social costs facing the steel plant’s community, as well as the threat to 40,000 UK jobs, if the Government failed to support the industry.

“Beyond the economic cost there would also be an intolerable social cost. There are 15,000 jobs directly at stake in the industry and a further 25,000 jobs at stake in the wider supply chain. These are the kind of high-skill, high-pay jobs that we need to see more of.”

Sajid Javid, the Business Secretary, claimed the Government had “secured a reprieve” for the Port Talbot plant, allowing it to be sold rather than immediately closed following Tata’s decision to pul out of its UK operations.

Yesterday, Javid said the Government would consider “co-investing” with a private firm in order to stabilise the business. In his speech today he confirmed this could mean taking on some of the business’ debts.

The Government has outlined a 16-week window in which to sell the plant at Port Talbot. However, the sale of Tata’s long products plant in Scunthorpe took nine months.

Stephen Kinnock, Labour MP for Aberavon, where Port Talbot is located, questioned what the Government were doing to reassure customers and contractors of Tata that their contacts could be fulfilled in this afternoon’s debate.

“I regret that they have done little to address the issue of investor and customer confidence, which are of paramount importance at this time.

“The Government’s priority at the moment, alongside the efforts they should be making to find and support a commercial operator, should be about securing the order book.

“Erosion of the customer base is the most pressing issue facing the British steel industry at this time. If the customer base goes it is not coming back.”

Labour and unions have called for nationalisation of the plants – a key point of John McDonnell’s four-point plan to save British Steel.

Potential buyers for the Port Talbot plant are currently being sought. Sanjeev Gupta, the boss of metals trader Liberty House Group, has voiced interest in the plants, with the Telegraph reporting “tens” of other expressions of interests.